Money Matters – Not Monetary Policy

Featuring Jeffrey Snider

Jeffrey Snider, Head of Global Investment Research for Alhambra Investment Partners and leading authority on the monetary side of global economics, exposes the dichotomy between the supposed reflation and the Fed’s belief they are ahead of inflationary pressure. From the perspective of monetary policy since the 1990s, Jeff tracks the signals from Eurodollar futures to demonstrate how the Fed has eroded the economic base, rendering monetary policy ineffective and constraining growth. Filmed on March 14, 2017 in Palm Beach.

Published on
23 March, 2017
Topic
Structural flows, Financial System, Monetary policy
Duration
43 minutes
Asset class
Equities, Bonds/Rates/Credit, Currencies
Rating
34

Comments

  • JS

    John S.

    25 10 2017 12:04

    1       0

    Pure genius.

  • JV

    Jason V.

    3 8 2017 09:39

    1       0

    Superb! More please! One of the very best.

  • OD

    Orin D.

    12 7 2017 13:38

    0       0

    Jeff is on the right path, more people should be focused on the banking system credit creation process.
    He just waffled a bit though and didn't provide a wholeistic framework for monitoring credit growth going forward, further developments in banking system and implicaitons for asset prices. Also how did he go that whole presentation without mentioning Basel 3..........
    It a good presentation but it could of been amazing

  • DR

    David R.

    6 6 2017 23:14

    0       0

    Okay, an impressive presentation, but why then is the dollar crashing? Tq.

  • RM

    Russell M.

    30 3 2017 13:14

    0       0

    Very thoughtful analysis. I would add though that if the Fed were to start selling its balance sheet, I think interest rates would go up significantly though I doubt the Fed has the nerve to do so. Also, if they raise the Fed funds rate, it could tighten credit for auto loans which would depress sales to lower credit borrows like the ones who buy non-luxury cars. This could cause retrenching of the auto industry..

  • RZ

    RICK Z.

    30 3 2017 02:23

    6       0

    I had to watch it twice ,but I got it ,nothing short of brilliant --can we reserve him a chair at the Federal Reserve

  • BA

    Blair A.

    29 3 2017 03:52

    1       0

    Money is debt after 1971. Repeat after me: Banks Don't Lend Reserves. Banks create Credit thus money as deposits when they lend. THERE IS NO FRACTIONAL MONEY MULTIPLIER. GOVT DEFICITS

  • MF

    Martin F.

    28 3 2017 05:45

    5       0

    @ SAM B: Couldn't agree more. It takes time following Snider's blog to get into these things. His insights are amazing.
    @ RVTV: bring on a Master Class with Grant, Raoul, Mike Green, Daniel Want and J.Snider. There needs to be more clearification on what really defines liquidity and where it currently stands. This is crucial in understanding the global economy. (Practically. No upside in yields as liqu is low and falling)

  • TY

    Tyler Y.

    27 3 2017 18:39

    3       0

    Worth the sub price alone, excellent insight

  • JK

    Jon K.

    26 3 2017 16:07

    11       0

    I agree with Eric (Mar 26. 2017). This is only Part 1 of a soon to be series, right?

  • E

    Eric .

    26 3 2017 12:45

    29       0

    Incredible insight from a truly independent thinker. Jeff is brilliant and we must see more of him on RVTV. I urge a series of four additional interviews to focus on core concepts from this presentation, with the last one dedicated to Jeff's expectation for asset prices, bond yields, etc. He is one of the best.

  • BL

    Bruce L.

    25 3 2017 14:32

    1       0

    Japan once had a large Euroyen market but it disappeared under zero interest rate policy too. I also think oil was a kind of money substitute for mid east producers and the drop in oil from 100 to 50 has the effect of a tight money move.

  • KS

    Kathleen S.

    25 3 2017 10:42

    12       3

    The Great moderation is plain old credit expansion and they all knew it. There is no means of avoiding the final collapse of a boom brought about by credit expansion. It will end with voluntary abandonment of further credit expansion or later as a final and total destruction of the currency system involved. The final outcome of credit expansion is general impoverishment. What we have here is a good old fashion Ponzi scheme economy created by none other than the Federal Reserve. This criminal cabal needs to smashed and it's leaders taken out and shot.

  • DW

    Daniel W.

    25 3 2017 07:34

    22       0

    Brilliant!! JS is among the best - it would be great to have him appear more regularly, in either presentation or interview form on RVTV (at least quarterly if possible?). I think an interview with Grant/Raoul next would be great, especially to drill down further (in more practical terms) on his understandings of the monetary system and the investment implications for the major asset classes (understanding a little further how he reconciles monetary phenomena to different asset markets to gain forward looking perspective would be interesting I think).
    Fantastic presentation. Well done!

  • DS

    David S.

    24 3 2017 22:35

    4       0

    Excellent presentation by Mr. Snider. Good, bad or ugly monetary policies cannot solve real GDP issues. With all the disruptions of globalization, the internet and political incompetence, the risk of investment is very high and the number of probable net cash flow investments is low. Monetary policy is not as important as who, where and how can money be put to work productively. DLS

  • AH

    Andreas H.

    24 3 2017 21:25

    4       0

    So what is the trade based on this? If reflation doe not come the fed might not be able to hike much more, or even have to lower again. Bonds would rally (TLT etc.) and the economy would grow slowly and would come close to recessions more often (like in Feb 2016)??????

  • SB

    Sam B.

    24 3 2017 17:29

    22       0

    YES. Bravo for bringing back Jeff... something I've been clamoring for for months! The rise and fall of the Eurodollar system is by far the most complete explanation of why things have happened as they have in finance and the economy over the last few decades. His work is truly unique and it's also immensely underappreciated... I strongly encourage anyone remotely interested in this material to read his blog. It might take several months to figure out exactly what he's talking about, but these RV presentations make it easier to crack the code. Once you understand the nuances of his thesis, you will never look at the financial world the same way. My only gripe (if you can call it that) is that this left me wanting even more. As someone below outlined, Snider's range of expertise is very broad. An interview with Grant, Raoul or Mike Green touching on the CNY, JPY, swaps and repo would be huge.

  • RD

    Ryan D.

    24 3 2017 14:48

    3       1

    Love Jeff's work. Following his twitter feed and blog have schooled me on the failings of the current system. Bravo Jeff and RV.

  • VK

    Viresh K.

    24 3 2017 11:02

    0       0

    I find some of the topics mentioned in all of Jeffery's interviews extremely complex. Perhaps it's worth RV/ him releasing one of those 'cheat sheets' that Michael Green had to help viewers follow.

  • VS

    Vikram S.

    24 3 2017 08:19

    4       0

    I love this man's presentations!

  • JL

    Jesús L.

    24 3 2017 07:11

    12       0

    Congrats to RV.
    Sneider with two or 3 more people are the few that understands money, and modern finance.

    I think RV should ask him to explain his view on "short Dollar" and also some master class over the eurodollar system.

    There is no enough thanks to RV to give him back.

  • T~

    Tshort63 ~.

    24 3 2017 05:57

    4       0

    Great. Just when I think I understand something the rugs is pulled out again. :-) I'll have to watch this 4-5 more times to get a hint of what he is saying but I found it all very funny. Another great interview, thanks, RV!

  • LK

    Lisa K.

    24 3 2017 05:37

    0       0

    So Greenspan got the US out a jam with Eurodollars, and since there is no replacement for Eurodollars to get out of our current jam, the US can't get out of it alone, the world central banks will have to agree to do something together, i.e. global devaluation/reinflation. Fractional banking as we know it now, may not survive. So is hard assets like bitcoin/gold in our future? And peer to peer lending?

  • JH

    Joel H.

    24 3 2017 04:58

    3       0

    I love every one of his presentations, really gets me to think, which is why I come to RV.

  • RB

    Richard B.

    24 3 2017 01:15

    4       0

    The best of the best. He's more valuable than the vast majority.

  • GG

    Gerald G.

    24 3 2017 00:30

    5       2

    Facinating and disappointing. This was a great analysis but I already knew that central banks have lost control. What I want to know is: what does this potentially mean going forward?
    If the real situation has never been properly understood and all the tinkering by the Fed has been irrelevant are we headed for an armageddon type reset, indefinite stagnation, social upheaval (in the form of war or revolution)....or what????

  • RA

    Robert A.

    23 3 2017 22:57

    9       0

    Once again I have been presented a viewpoint by RV TV that I have never considered or have heard from any other source. That alone is worth the subscription price to me. I'm curious what Raoul and Grant think of this viewpoint as to my memory neither have addressed it head on.

  • M.

    Milton ..

    23 3 2017 22:37

    7       0

    Here is the download link to Jeffrey Snider's presentation: https://we.tl/jSbfm7cWV0

  • GS

    Gordon S.

    23 3 2017 22:02

    5       0

    Amazing interview! Please have him back! I personally do not like to hit pause while watching an interview, so it would be great to slow down a little and maybe explain some charts in a little more detail? I also found the annotation on some charts a little too light for my taste. It for example took me ages to understand the chart at -19:37. Other than that it would be great to see the same analysis for China and also aggregated over the whole global economy? P.S.: Damn I would love to have access to a Bloomberg account to check all these numbers myself :).

  • MY

    Madjid Y.

    23 3 2017 21:56

    4       0

    Excellent work thank you
    It will be great if JEFFREY SNIDER can expand on this argument in future contributions:
    “And so we have to evaluate quantitative easing, not as money printing but what it actually was, which was essentially creating a bunch of useless, inert by-products of long, large scale asset purchases, which expanded the Federal Reserve's balance sheet but little else. It didn't achieve any kind of money printing. And in fact, we can't detect any kind of money printing in the economy or in these markets, largely because it wasn't”.
    Being based in London, I can detect that in house prices and stock market valuation, is it that the long due hyperinflation occurred in the form of asset price inflation?

  • EK

    Emil K.

    23 3 2017 21:13

    18       0

    I cannot recommend Jeffrey's blog more highly. He is a fountain of monetary and historical knowledge. Brazil, China, Mexico, Eurodollars, Federal Reserve in the 1920s, Labor Market, Housing, VAR, gold, 1930s, late 19th century banking, October 15, 2014. He covers it. Three daily posts or so on average. (Larry B., please re-listen to interview. I promise you that JPS does not believe he was a maestro. Just the opposite.) Thank you RV for alerting me to his work.
    http://www.alhambrapartners.com/author/jsnider/

  • lb

    larry b.

    23 3 2017 20:56

    1       37

    waste of time listening to someone that believes greenspan was the maestro. he was a disaster.

  • DM

    Daniel M.

    23 3 2017 19:29

    4       0

    Really interesting big picture view. Great stuff RV.

  • Nv

    Nick v.

    23 3 2017 18:17

    4       0

    Great talk. I would point to two issues worth considering when it comes to his reflation theory. 1. I started going to China in 2004 and it was fact that it exported DEflation to the rest of the world. That fact has recently changed. China is now exporting INflation to the rest of the world. Do not underestimate this. 2. We have seen the velocity of money fall for 20 years straight due to excessive debt, and the annihilation of animal spirits in the economy (regulation etc). Economists seems to accept that this will always be the case. I suspect the probability that it wont keep falling is well higher than the 0% economists subscribe to this outcome

  • jh

    john h.

    23 3 2017 17:31

    5       0

    Bravo! Really well done. Snider was reassuring in his sound understanding of underlying concepts (if not his message). As an aside, one doesn't have to go far to understand how fraught measurement of the "output gap" really is; economists really just winging this. See here for instance. http://www.imf.org/external/pubs/ft/fandd/2013/09/basics.htm

  • CB

    C B.

    23 3 2017 17:22

    4       0

    We need MOAR of these monetary-based examinations of our financial system and markets. Fascinating stuff.

  • WS

    William S.

    23 3 2017 15:59

    15       0

    Snider once again demonstrates how the "intellectual but idiot" class of contemporary academic economists have utterly *fubarred* the entire global monetary system. A generation or so hence, economic historians will have consigned Greenspan, Bernanke, et al. to the dustbin of shame where they belong -- at which point it will probably be just about time for a future iteration of monetary mandarins to start making the same mistakes all over again ...

  • RM

    Richard M.

    23 3 2017 15:47

    6       0

    Jeff, really appreciate your clear and lucid explanations of what really happened behind the scenes in the banking/monetary crisis that we have all been through. It helps to have a better understanding of what they (the Fed) did, and what they "thought" they were doing. I know they thought they were doing the right thing, but boy, it appears they were all a bunch of clueless idiots (at least that's how it looks in hindsight)!

  • SW

    Scott W.

    23 3 2017 15:14

    40       0

    Brilliant. I'll need to watch again because I'm further to the left on the IQ curve.

  • AC

    Andrew C.

    23 3 2017 13:57

    4       0

    Jeff might have presented an alternative to the eurodollar system. Overall a terrific presentation of the failed monetary exercises of the past 30 years.

  • M.

    Milton ..

    23 3 2017 13:28

    7       0

    GIEDRIUS A. you can download the transcript by clicking the 'Transcript' button in the video card for this piece of content. M

  • LV

    Luís V.

    23 3 2017 13:11

    8       0

    Imagine, just imagine that the Maestro (in one of those true revisiting interviews) was here with Jeff and answering to his arguments and objections!
    Great work, JS and RV tv.

  • PU

    Peter U.

    23 3 2017 12:49

    2       0

    His presentation took the words "right from my head"! What a great job explaining a difficult reality!

  • PU

    Peter U.

    23 3 2017 12:47

    1       1

    F&$%ing awesome! Bravo!!!

  • JC

    Joe C.

    23 3 2017 12:10

    3       1

    So the FED is Flying Blind and has been Flying Blind for Decades!

  • GA

    Giedrius A.

    23 3 2017 11:22

    10       9

    Why don't we have option to download transcript of the presentation as it is very important to read and understand what has been said?